Boskalis 2017 Half Year Report

HALF YEAR REPORT 2017 – BOSKALIS 17

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The interest-bearing debt totaled EUR 288.0 million at 30 June, resulting in a net cash position of EUR 234.5 million. At the end of 2016 interest-bearing debt was EUR 762.6 million and the net cash position EUR 202.7 million. The interest-bearing debt position relates to a long-term US Private Placement (USPP) of USD 325 million (EUR 285.0 million as at 30 June 2017). This US Private Placement matures in six years (2023). Furthermore, Boskalis has a EUR 600 million syndicated bank facility at its disposal, which was undrawn as at 30 June 2017. Boskalis has agreed a number of covenants with the syndicate of banks and the USPP investors. These covenants were comfortably met as at 30 June 2017. The main covenants relate to the net debt : EBITDA ratio, with a limit of 3, and the EBITDA : net interest ratio, with a minimum of 4. At 30 June 2017 the net debt : EBITDA ratio stood at -0.4 (net cash position) and the EBITDA : net interest ratio at 17.5. The 2016 Annual Report of Royal Boskalis Westminster N.V. provides an overview of Boskalis’ risk management and describes the main risk categories: strategic and market risks, operational risks, financial risks, other risks including non- compliance with laws and regulations, and risks related to financial reporting as well as internal risk management and control systems. More information can be found on pages 49-54 of the 2016 Annual Report and in the online annual report at https://boskalis.com/annualreport. The principal risks also apply to the current financial year. In the second half of 2017 the extent to which new projects are acquired with associated commercial terms and conditions will be largely dictated by the general prevailing economic circumstances in the geographic markets relevant to Boskalis and in particular by the state of affairs for services providers to the oil and gas sector. PRINCIPAL RISKS AND UNCERTAINTIES

The tax charge in the first half of the year was EUR 19.6 million (H1 2016: EUR 18.9 million). The tax rate, excluding the result from joint ventures and associates, was 27.0%, compared to 10.8% for the first half of 2016. This relatively high tax rate is explained by the relatively large share of the earnings generated in higher rate regimes, mainly in Europe. The low rate in 2016 was mainly due to the fact that a larger proportion of the project results were achieved in countries with lower tax rates and the largely untaxed book profit relating to the Kotug Smit Towage joint venture transaction. In the first half of the year an amount of EUR 112.2 million was invested in property, plant and equipment (H1 2016: EUR 99.6 million), of which EUR 14.4 million was related to dry dockings. Divestments were made totaling EUR 8.4 million. Within Dredging the construction of the new mega cutter Helios was the largest investment. The vessel has been completed and was commissioned on 1 July. Investments within the Offshore Energy segment included the conversion of the Finesse heavy transport vessel into the Bokalift I crane vessel. At 30 June, capital expenditure commitments increased to EUR 193 million (end-2016: EUR 62 million). These commitments mainly relate to the sister vessel of the Helios and the Bokalift I crane vessel. In the second quarter Boskalis paid EUR 29.5 million (2016: EUR 55.8 million) to those shareholders who opted to receive the 2016 dividend in cash. This represented around 23% of the dividend, with the remaining 77% distributed in the form of shares. As a result, 3,275,042 new ordinary shares were issued, bringing the current total number of outstanding Boskalis shares to 133,351,894. On 28 February 2017 Boskalis sold its remaining investment in Fugro N.V. The shares were sold through an accelerated bookbuild, via which 7.9 million (9.4%) certificates of shares in Fugro were placed with institutional investors at EUR 14.50 per share. The total proceeds amounted to EUR 115.0 million. The cash position at 30 June was EUR 522.5 million (end-2016: EUR 965.3 million). The solvency ratio increased to 62.6% (end-2016: 56.1%). The cash flow for the first six months amounted to EUR 198.5 million (H1 2016: EUR 283.7 million). CAPITAL EXPENDITURE AND BALANCE SHEET